Should You Buy Before Selling? Exploring the Buy/Sell Dilemma
Deciding whether to buy a new home before selling your current one can feel a bit overwhelming. The right approach depends on many factors, but it's not so daunting if you examine the current market. Instead of focusing on whether you should buy or sell first, let's consider what you could do to make the best decision for your unique circumstances.
The question of whether to buy before selling depends on your unique situation and goals. But could you make this choice and still be in a good position? Definitely. The housing market is currently HOT and leans heavily in favor of sellers. If you buy a home before selling your current one, the market conditions are working for you. On the other hand, selling before buying could leave you in a tough spot. You might have to settle for a less-than-ideal home due to time constraints and limited options, or face challenges in the competitive rental market.
However, it's essential to remember that every situation has two sides. The real estate market is always changing. That's why it's crucial to evaluate all angles before making a decision.
Pros of Buying First:
You have the security of knowing where you'll be living next.
You can focus on purchasing your new home before dealing with selling your current one.
You can plan your move more effectively with a clearer timeline.
Cons of Buying First:
You may be stuck with 2 properties that was not planned for and have to figure out alternative financing options.
Carrying costs for holding 2 properties simultaneously.
This strategy is utilized more in hot resale markets, where finding the right home before your current one sells is essential.
Pros of Selling First:
You know exactly how much money you'll have from the sale of your home.
You can more easily arrange interim financing if needed (to cover two properties temporarily).
You don't need to qualify financially to own two properties simultaneously.
You avoid the risk of holding two properties unless you choose to.
Cons of Selling First:
You may not find your perfect home in time and be left looking for a short-term rental or have to stay with family/friends.
Storage costs for your belongings while you are looking for your new home.
This approach is utilized more in slower markets, where selling your home might take longer, or achieving a specific sale price within a desired timeframe isn't guaranteed.
There's no one-size-fits-all answer, but you can make confident decisions when you have all the facts in front of you. To avoid getting caught in a loop of uncertainty, we recommend reaching out to your favourite MMG broker. If you haven't already, this is something you could do to gain clarity. A mortgage broker can offer expert guidance tailored to your unique situation, answering your questions and providing peace of mind. In addition, making sure you have a realtor on your buy/sell team who can update you on market conditions, resale turnaround times and appropriate pricing is invaluable. Having a team of real estate and mortgage professionals in your back pocket to help you navigate this important decision will only help set you up for success!